I always try to go with how much covering I am sleeping with...for instance, I'm currently in a tank and pj pants with a light blanket, so my DD sleeps in pj pants and short sleeves. When I check on her, if her skin feels cold, I'll put her in a long sleeved shirt. When it warms up more and I'm in short pj's and a sheet, I'll put her in just a onesie or shorts/tee pj's. She's almost 2.5, but still doesn't keep a blanket on either. If you still want to do long-sleeves, perhaps a looser long sleeved option (like lightweight footie pj's) may allow for more "breathing".
You may want to put a small fan in his room, just to keep air flowing (if he sleeps with the door closed) - sometimes I find that the temp is fine, but the room is stuffy.
Just a note - If you go the route of a diaper only, be careful of when your little one may "decide" that nudity is a better option... ;) My DD learned how to take off her clothes and diaper at about 17 months...